But slot GGR will be up
Brokerage Sanford C. Bernstein Ltd. predicts that gross gaming revenues in Singapore will drop 2.4 percent year-on-year when the full results for 2018 are tallied. Bernstein says market-wide GGR will reach SGD$6.20 billion (US$4.53 billion).
In a December 7 note, the brokerage reported that combined 2018 VIP revenue for Marina Bay Sands and Resorts World Sentosa will come in at SGD2.31 billion (US$1.684 billion), compared to SGD2.49 billion (US$1.815 billion) in 2017. GGR for mass-market tables will reach SGD2.32 billion (US$1.691 billion) for 2018, down 3.8 percent year-on-year. But slot GGR was expected to increase 8.9 percent to SGD1.57 billion (US$1.14 billion), according to analysts Vitaly Umansky, Kelsey Zhu and Eunice Lee.
“Singapore is a stable growth market with significant cash flow generation,” the analysts wrote. Following the opening of the market’s two properties in 2010—MBS is a Las Vegas Sands resort, Resorts World Sentosa is a Genting property—the city’s casino industry produced annual GGR that peaked in 2014 at SGD7.63 billion (US$5.56 billion).
Then came Chinese President Xi Jinping’s anti-corruption campaign, which hit hard in Macau for the next two years and also created “significant headwinds” for other markets including Singapore, the team wrote.
“We estimate that over 50 percent of VIP is comprised of Chinese players,” the analysts observed. “In 2015, the relative softness of the Chinese economy along with the anti-corruption campaign exerted influence on the VIP market in Singapore (rolling chip volume down 23 percent year-on-year and VIP GGR down 31 percent year-on-year).”
The market saw a modest rebound in 2017, the team wrote, according to a news report on GGRAsia. “Our current forecast assumes a 2 percent compound annual growth rate for the next five years” through 2022. “We think Singapore market GGR will get back to SGD7 billion by 2022.”
In related news, according to Asia Gaming Brief, Genting Singapore is facing increasing competition in the mass segment, though there could be room for growth in VIP. At a recent conference in Tokyo, management affirmed it’s going after more business from new and existing customers in the ASEAN and North Asian markets.
While Nomura sees VIP roll up 19 percent for the year, it contends that mass “is likely to remain flattish, as the grind segment is facing competition from the regional mass markets like Cambodia and Philippines, which can offer cheaper rooms than Singapore and also more complementary services.” Nomura sees the mass drop up 10 percent in the year to end September with a market share of 35 percent compared to 41 percent a year earlier, AGB reported.
